Action urged on labour hire companies

A national licensing and registration scheme should be introduced for labour hire companies to stop the exploitation of vulnerable workers across the country, a South Australian parliamentary committee says.

The committee looked at issues within the labour hire section, including the tactic known as "phoenixing", where unscrupulous companies dissolve their operations and start up under another name to avoid their legal obligations.

In its report tabled in state parliament on Tuesday, the committee said the problem required a national response.

But it said in the absence of national action, the state government should proceed with its own licensing arrangements, including the application of a fit-and-proper-person test for the owners and directors of labour hire companies.

The committee's investigation was sparked by a string of media reports that exposed problems in various industries, including the fresh food sector, where gangs of black market workers were exploited by labour hire firms.

Companies often preyed on vulnerable young foreigners who were overworked and underpaid, and forced to live in unsatisfactory accommodation.

The committee said the revelations shocked people across the country and sparked a federal inquiry as well as inquiries in three states.

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Committee presiding member Lee Odenwalder said any licensing system must also place some onus on the end-user of labour hire workers to ensure their provider is complying with the required standards.

"As well as its major recommendation of a national licensing and registration scheme, the report recommends a national approach to monitoring and enforcement involving proper inter-agency co-operation and data sharing," Mr Odenwalder said.

The National Union of Workers welcomed the SA report and urged other states to follow SA's lead.

"Labor hire firms have become notorious for exploiting workers across industries," the union said.